Natural Disasters: Mitigating Impact, Managing Risks

33 Pages Posted: 1 Nov 2012

See all articles by N. Laframboise

N. Laframboise

International Monetary Fund (IMF)

Boileau Loko

International Monetary Fund (IMF)

Date Written: October 2012

Abstract

This paper reviews the literature on the macroeconomic impact of natural disasters and presents the IMF's role in assisting countries coping with natural catastrophes. Focusing on seven country cases, the paper describes the emergency financing, policy support, and technical assistance provided by the Fund to help governments put together a policy response or build a macro framework to lay the foundation for recovery and/or unlock other external financing. The literature and experience suggests there are ways to strengthen policy frameworks to increase resilience to natural disaster shocks, including identifying the risks and probability of natural disasters and integrating them more explicitly into macro frame-works, increasing flexibility within fiscal frameworks, and improving coordination amongst international partners ex post and ex ante.

Keywords: External shocks, Low-income developing countries, Emergency assistance, Risk management, Fund facilities, Fund role, natural disasters, economic growth, self-insurance, contingent financing, buffers

JEL Classification: F33, H84, O44, Q54

Suggested Citation

Laframboise, N. and Loko, Boileau, Natural Disasters: Mitigating Impact, Managing Risks (October 2012). IMF Working Paper No. 12/245. Available at SSRN: https://ssrn.com/abstract=2169784

N. Laframboise (Contact Author)

International Monetary Fund (IMF) ( email )

700 19th Street NW
Washington, DC 20431
United States

Boileau Loko

International Monetary Fund (IMF) ( email )

700 19th Street, N.W.
Washington, DC 20431
United States

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